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Consumer Groups Dial Up Opposition To Telecom Bill


Consumer Groups Dial Up Opposition To Telecom Bill

The following appeared on the Gongwer News Service, March 26, 2012.

Advocates for seniors and low-income Ohioans called on the House Monday to kill a proposal to deregulate phone companies that already passed the Senate earlier this month with minimal opposition.

The coalition of consumer groups said the bill (SB 271*), which would allow incumbent telephone companies withdraw basic landline service if they show competition exists in an exchange, would fall heavily on the elderly, poor and rural Ohioans, who can't afford more costly wireless options.

For its part, the telecom industry continued to argue that "carrier of last resort" (COLR) requirements for landline service divert job-creating investments in more high-tech communications technology to old-fashioned wire technology for which demand is dwindling.

Led by AARP, the opposition coalition includes the Ohio Poverty Law Center, Appalachian Peace and Justice Network, Legal Aid Society of Southwestern Ohio, Pro Seniors, Center for Rural Strategies, Edgemont Neighborhood Coalition, and Communities United for Action.

Consumer Groups Dial Up Opposition To Telecom Bill

The following appeared on the Gongwer News Service, March 26, 2012.

Advocates for seniors and low-income Ohioans called on the House Monday to kill a proposal to deregulate phone companies that already passed the Senate earlier this month with minimal opposition.

The coalition of consumer groups said the bill (SB 271*), which would allow incumbent telephone companies withdraw basic landline service if they show competition exists in an exchange, would fall heavily on the elderly, poor and rural Ohioans, who can't afford more costly wireless options.

For its part, the telecom industry continued to argue that "carrier of last resort" (COLR) requirements for landline service divert job-creating investments in more high-tech communications technology to old-fashioned wire technology for which demand is dwindling.

Led by AARP, the opposition coalition includes the Ohio Poverty Law Center, Appalachian Peace and Justice Network, Legal Aid Society of Southwestern Ohio, Pro Seniors, Center for Rural Strategies, Edgemont Neighborhood Coalition, and Communities United for Action.

Ed Cokely, AARP advocacy volunteer, said allowing telephone companies to abandon basic landline service in places where it is less profitable for them could have "catastrophic" consequences.

"Ohio seniors, like seniors elsewhere, rely on their landline service to connect to their families, doctors, emergency services and their communities," he said during a news conference.

"Senate Bill 271 asks customers of plain old telephone service to forfeit way too much merely because the big telephone companies have really become proficient in packaging a deregulation proposal in the glittery wrappings of economic development and job creation," he said.

Mr. Cokely asked lawmakers to delay passage of the bill until the Select Committee on Telecom Regulatory Reform is convened and analyzes the impact of last session's deregulatory changes (SB162, 128th General Assembly), which also created the panel.

Mike Walters, managing attorney for Pro Seniors legal hotline, said the measure's potential impact on the Lifeline program for low-income seniors was "potentially catastrophic."

Edyael Casaperalta, of the Center for Rural Strategies in Kentucky, said consumer advocates recently managed to stall a similar proposal in that state by highlighting its potential impact to lawmakers' constituents.

"Once the legislators in Kentucky heard about the issue, it was a no-brainer. They understood that rural people, older people really need basic telephone service to communicate," she said.

Ron Bridges, government affairs director for AARP, said the coalition of consumer groups would try the same approach.

The telecom bill is the first state issue that AARP will outline in its "accountability vote" initiative, which communicates to the organization's 1.5 million members how their legislator voted on the bill, he said. The group will focus on House members, rather than senators, because they will have "fair warning" about the issue.

Mike Smalz, senior attorney with the Ohio Poverty Law Center and the Appalachian Peace and Justice Network, said the measure was unnecessary because telephone companies already have the option to ask the Public Utilities Commission of Ohio for a waiver to withdraw basic service.

Even though the current procedure requires no evidentiary hearing or discovery proceedings, phone companies want the legislation as a way to bypass the "very minimal test," he said.

Ellis Jacobs, of Edgemont Neighborhood Coalition of Dayton, said about 1 million Ohioans used only a landline as of 2010, according to the federal Centers for Disease Control.

The telecom industry is pushing the proposal to increase it profits, he said, noting phone companies have hired 34 lobbyists to work the issue and have made significant contributions to legislators.

Ohio Telecom Association President Charles Moses defended the proposal as a way to make the state more competitive.

He noted that COLR requirements date back to the monopoly era, when an exclusive franchise to serve a territory carried with it the obligation to serve everyone who wanted service.

"In today's fully competitive market, the COLR obligation requires the expenditure of money and other resources on providing basic local exchange service where there may be no market demand for such services," he said in a statement.

The Federal Communications Commission has said the COLR issue should be addressed individually by the states, he said, noting that nine states have already passed similar legislation, including: Indiana, Michigan, Wisconsin, Florida, North Carolina, South Carolina, Tennessee, Kansas, Missouri, and Texas.

Mr. Moses said the legislation responds to the explosion in the development of new technologies and increasing competition.

"The legislation would only apply to fully competitive markets within the state. Senate Bill 271 is about modernizing our regulatory framework in Ohio so we remain an attractive place to invest the telecom industry's capital dollars, while continuing to maintain adequate and appropriate consumer protections," he said.

"The development of new services requires significant continued capital investment for telecom networks to deliver the exponential explosion in voice, video and data traffic," he said.

Mr. Bridges said the telecom industry used the same economic development argument when pushing for last session's legislation, but two years later AT&T said during testimony on the current proposal that they reduced their workforce by 2,000 employees. "Are we going to fall for that same hokeydoke in 271?"

Mr. Smalz said the bill could have the "perverse effect" of eliminating competition because many alternative providers, like cable companies, rely on the same landline infrastructure to reach their customers.

OCC Funding: Mr. Bridges said AARP's advocacy on the telecom legislation coincides with a separate effort to lobby the General Assembly to increase funding for the Ohio Consumers' Counsel, which was cut by about 50% in the biennial budget (HB 153*).

Deliberations on Gov. John Kasich's "mid-biennial review" budget measure offers an opportunity for advocates to make their case to restore full funding to the OCC, he said.

The energy-related MBR (SB 315*) is the appropriate measure to increase OCC appropriations, he said, describing legislative action on the telecom proposal "a fine example" of what happens when the agency doesn't have enough money to adequately represent consumers' interests.

"We understand. It may have been a mistake. It may have been the shock and awe of being told, 'Get on the bus or get run over.' But now there's been a year to really settle in and see what the impacts of various laws are on Ohioans," he said.